Two Things You Have to Do to Stop Living Paycheck to Paycheck

Specifically, I mentioned two things that you absolutely have to do if you want to get control of your finances and eliminate the possibility of financial failure for good. These first things that have to happen are:

You have to change your mindset about money

You have to change your habits with money

Of course, these two subjects are kind of broad. Let’s drill down into them a little and I will show you some very specific things you can do toward changing your mindset and habits when it comes to finances.

Changing Your Mindset About Money

That may sound like an oxymoron, but it is possible to earn a high income and still not be successful with money. Here are a few reasons why, along with a helpful solution to each problem:

Too Many Believe That Debt is a Necessary Part of Life

So many people, even those with a high income, blindly accept the belief that you must have debt to get along in modern society. That’s one of the biggest reasons there are so many high income earners living paycheck to paycheck.

Solution: You can change your mindset about debt by accepting the fact that debt is bondage. The more debt you have, the less freedom you have to live your best life. Eliminating the paycheck to paycheck life for good starts with getting your head right when it comes what you believe about debt. I’ve written a number of excellent articles that can help you with getting a better mindset about money. Here are a few to get you started:

Living Paycheck to Paycheck is About Wants vs. Needs

Another mindset shift needs to happen in how you perceive wants vs. needs. Ask someone in a third world country what their needs are, and there is no confusion on the subject. They know that our basic needs are very simple. They will tell you things like:

Food

Water

Shelter

Safety

Love

Freedom

Good Health

Spiritual Connection

High Income Earners Have Different “Needs”

However, ask someone in a first world country, especially a high income earner who is living paycheck to paycheck, and there tends to be a lot of confusion. You will hear them say things like:

It’s easy to get spoiled when you have a high income and start believing that you need certain things that are really just wants. But if you’re living paycheck to paycheck, it’s time to reevaluate just what your needs really are.

Solution: Start with the “third world” list above and work from there. Imagine yourself having a conversation with someone in the third world about needs. If your needs are something they would roll their eyes at when you tell them, they are not needs at all. Make the effort to realize that our true needs are very few, and everything else is icing on the cake.

The Higher the Income, the More Entitled You Feel

When you make a good living, you feel entitled to spend your money any way you want.

It is a free country after all.

But earning a high income has a tendency to make you feel entitled, and that’s not such a good thing. Here are some of the phrases you might hear from someone with an entitlement mentality:

I deserve it

I worked hard to be able to get that

This is what makes me happy

Unsurprisingly, these are the same phrases you will hear from many average income earners who live paycheck to paycheck as well.

Don't Let a High Income Lead to Entitlement

Making a high income is great. But if you feel entitled to the point that you’re spending as much or more than you make, that can be a problem. Living paycheck to paycheck on a high income is no more fun than living paycheck to paycheck on a low income. Either way, it’s stressful and doesn’t make for a happy life.

You have to understand that a shift in your thinking has to happen to overcome the entitlement mentality. You have to realize that a high income doesn’t entitle you to everything you want that money can buy. And you should come to the knowledge that borrowing money to fund a higher lifestyle than you can truly afford makes for a poor use of a high income.

Solution: In order to get rid of the entitlement mentality you have to develop a different perspective. One way to do that is to change your internal dialogue when it comes to money.

Work on catching yourself when you’re using entitled speech and thinking. Then you can “flip the script” by using other speech and thoughts that are more in line with reality. For instance:

Replace “I deserve it” with “Can I buy it without having to go into debt for it?”

Replace “I worked hard to be able to get that” with “I shouldn’t have to work so hard just to make my debt payments.”

Replace “This is what makes me happy” with “I’ll be much happier with stuff that doesn’t require me to live paycheck to paycheck in order to have it.”

Learning to talk and think differently about your financial life can make a huge difference in eliminating the paycheck to paycheck lifestyle for good.

Work on These Three Things to Change Your Mindset

So, go ahead and work on these three things to help get your mindset right about leaving the paycheck to paycheck life forever.

Understand that debt is not a necessary part of life

Learn that wants are very different from needs

Flip the script when it comes to entitled speech and thinking

How to Change Your Habits With Money

I had originally intended to include info about how to change your habits with money in this post. But hey, looks like I got a little long winded here. So I will be writing a third post for the Living Paycheck to Paycheck on a High Income series.